The Cross-Border Implications of WEEE

By now most obligated businesses will have met their first hurdle in dealing with the new legislation to tackle waste electrical and electronic equipment – registering with one of the approved compliance schemes. To stay on the right side of the law, all companies affected by the new environmental rules should be registered with one of the schemes set up to administer and discharge their members’ responsibilities under the WEEE regulations. However, while there are a host of regulatory and data management issues that should not be underestimated, the biggest cost of WEEE will come from transport. Recent studies predict that as much as 60 per cent of all WEEE costs will relate to the collection of discarded product. And our experience supports the view that proportionately these costs may well increase as time goes by with the cost of recycling falling as processing capacity increases. Clearly, getting the logistics element of WEEE implementation right is a key business issue.

Pan-European issuesIt is therefore surprising that while most businesses have rightly registered with one of the approved compliance schemes, many have failed to think through the implications from a crossborder perspective, not giving serious consideration to the pan-European issues created by the birth of the new legislation.

Although conceived by the EU, the Directive was never meant to be implemented in a totally uniform way across all member states. Instead Brussels allowed a certain amount of local interpretation, allowing countries to amend the Directive to fit with their respective economies, cultures and existing waste infrastructure.

Similarly, businesses operating on a pan-European basis also need to have good understanding of differing waste legislation across borders, given the tight regulations on what materials can and cannot be exported for recycling and reclamation. The issue of developing cost effective cross-border strategies for dealing with WEEE will have big implications on businesses with obligations in Europe. Obviously, working with a compliance scheme that can not only advise on the practicalities of the legislation in the UK, but also the pan-European issues of compliance and logistics will be key to long-term competitive advantage.

Effective logistics and systems will not only lead to lower costs, but when collections are to be undertaken from business premises can also enhance the customer’s product experience over the whole life cycle. Additionally the availability of compliance solutions across Europe will enable a compliance scheme to fully tap the opportunities.

Many businesses believe that by registering with a compliance scheme, they have effectively passed on their WEEE obligations to a third party. This attitude could prove problematic for businesses that have not carefully thought through the practical implications from a logistics and customer service perspective. A poorly executed collection from one of your customers could have negative implications for your brand image.

This is where the choice of compliance scheme can have a huge impact on a business’ reputation as it grapples with WEEE implementation. Choosing a WEEE partner without a proven track record of reverse logistics and customer service could seriously damage the chances of them successfully carrying out WEEE services on your behalf.

While many schemes have been launched by organisations with a background in a specific trade sector or by businesses that believe synergies exist with packaging regulations, their credentials are less appreciated when it comes to the practical experience of transport management and undertaking the collection of large volumes of equipment from around the UK or from across Europe.

Some products affected by WEEE could fit into a simple returns envelope. However, specialist kit such as industrial equipment, medical devices, imaging equipment and automatic vending machines are just some examples of objects that would require expert knowledge to safely uninstall, pick-up and transport. Health and safety issues have received very little attention so far when the implications of WEEE are discussed, but the fact is that whether collecting from a local authority recycling centre or an office, school or hospital safety needs to be the number one priority. Giving consideration to whether products are likely to be presented for collection on the ground floor or not, are in a suitable container, are in areas where members of the public circulate, or require specialist handling due to their size or hazardousness, are all important, but often overlooked, points. Their potential for value recovery or re-use is often not considered when sourcing a WEEE compliance solution but might impact a company’s bottom line significantly. While practical experience of reverse logistics is an obvious advantage when considering a compliance scheme, the ability to offer a bespoke service for your business is another important consideration. Historically, most businesses have concentrated on delivering new products to the distributor or end customer. Now they will need to focus efforts to ensure these products are collected (and recycled) at the end of their lives. One of the key performance indicators that businesses should consider is the network density of the logistics provider that has either established the compliance scheme or is working with the scheme’s management.

Generating economies of scale will be a hugely important factor as the provision of take-back services is part and parcel of being a scheme. Those compliance schemes that have the backing of dense logistics networks are much more likely to achieve real scale economies, as well as much more responsive service levels.

Similarly, achieving a sophisticated level of reverse logistics goes hand in hand with the ability to extract residual value from waste products. As new markets in waste electrical components emerge, the ability to sort and transport materials that can be reprocessed and used in manufacturing will become an important revenue generator for many businesses. Additionally some companies will learn more about their products use and their customers when analysing end of lif equipment enabling them to enhance a new products’ design. It stands to reason that the careful and efficient management of this business process will become another key area where companies will need to exert competitive advantage or face the prospect of losing money and reputation.

Paul James is general manager, WEEE Compliance Solutions & Environmental Development for DHL Exel Supply Chain; he can be contacted at Paul.james@dhl.com

Key Points

The WEEE Directive became UK law in January 2007. Obligated businesses should have registered with an approved compliance scheme – such as DHL – by March 15.

Full WEEE compliance should be met by July 1, 2007.

The UK is one of the last European countries to enact the WEEE Directive into law.

The Directive has been introduced across the EU, with each country providing its own interpretation when transposing into national law.